Rolls-Royce to sell its marine division

01/18/2018

The British jet engine manufacturer Rolls-Royce announced possible sale and restructuring of its marine division amid a decline in demand in the oil and gas market, as well as within restructuring of the holding, the company said on Wednesday.

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It is assumed that after the sale and restructuring of the sea division, the holding will retain subdivisions specializing in civil aviation, defence and energy systems. "This will contribute to a more fundamental restructuring, in particular, the functions of support and management," the company said in a statement.

The Maritime Division, which will be evaluated in the near future, produces marine equipment for the oil and gas industry. This business employs about 4.2 thousand people in 34 countries. The largest number of employees is based in Norway.

Rolls-Royce expects that the restructuring "will lead to an additional reduction in costs and will help improve the performance of the major divisions and the entire group." "We are in the process of defining this restructuring, and further details will be published simultaneously with the financial statements for 2017 on March 7, 2018," the company said.

In 2016, the holding reported that it planned to cut 800 jobs worldwide in the maritime division due to a decrease in demand for the holding's products from oil and gas companies. Following the results of 2016, the company received a loss before tax of 4.3 billion pounds sterling due to the payment of fines in the case of bribery, as well as because of a cheaper pound.

Shares of Rolls-Royce on Wednesday jumped 5.4% to 9 pounds sterling for a paper on the announcement of the planned restructuring, according to the London Stock Exchange.